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Basis for National Health Reform payments – Tasmania 2013-14

The basis used to determine NHR payments to LHNs in Tasmania was advised by the Tasmanian Department of Health and Human Services to be as follows:

Tasmania has developed a funding model (Tasmanian ABF Model) which will take a prospective orientation (i.e. it will produce the forward allocation based on the volumes of services to be funded that are determined in accordance with State planning processes). While in 2013-14 THO budget allocations continued to be developed on a historical basis, the ABF Model was used to develop an activity profile and block funded services allocation for each THO for 2013-14, capped by the historical budget allocation.

The funding arrangements and associated pricing focussed on the four ABF work streams of:

acute admitted,

other admitted (include sub-acute admitted and mental health), and

emergency department

Tasmanian pricing applied in 2013-14 with THOs has not used the NEP. In this regard, Tasmania has used the national average cost per work stream based on Round 15 National Health Cost Data Collection (NHCDC) data for 2010-11 indexed to 2013-14. For ICU and non-admitted, the State Average cost has been used. The National Average Cost was considered the most appropriate (where available) as it provides a National benchmark without the complication of NWAUs and the NEP.

Therefore the 2013-14 Tasmanian ABF Model pricing is based on the following:

The Tasmanian ABF Model also allocates block grants to THOs covering services provided and activities undertaken that are not within the ABF work streams. This includes teaching, training and research, non ABF hospitals and other operational grants costs which are deemed out of scope for Commonwealth funding.

Between February and June 2014, the Commonwealth provided Tasmania with additional public hospital funding of $5,167,765.41 under the funding measure: National Partnership on public hospital system - additional funding. This funding was provided to offset the downward adjustments to 2013-14 NHR funding applied at the 2013-14 Mid-Year Economic and Fiscal Outlook (MYEFO) and the 2014-15 Budget, due to the application of updated NHR funding indexation parameters. A requirement of the provision of this funding was that it is passed on in full through the National Health Funding Pool and/or State Managed Fund to LHNs for activity based and Block Funding, and State and Territory health departments for public health funding.